Tiangco v. ABS CBN

CARMELA C. TIANGCO vs.
ABS-CBN BROADCASTING CORPORATION

G.R. No. 200434
December 06, 2021
Facts:
Petitioner Carmela Tiangco was initially engaged by respondent ABS-CBN Corporation
as Talent Newscaster, on an exclusive basis, on 22 July 1986 with a monthly talent fee of
Php8,000.00 for a period of 1 year. Subsequently, petitioner’s contract was renewed. Upon
expiration of the contract, ABS-CBN entered into the May 1994 Agreement with Mel & Jay
Management and Development Corporation, committing to provide petitioner’s services to ABS-
CBN as exclusive talent for radio and television. Thereafter, ABS-CBN issued a Memorandum
concerning commercial appearances of its talents and regular employees. The Memorandum
directed all on-air and/or on-camera talents and employees in the Radio and the News and Public
Affairs Departments to refrain from appearing in commercial advertisements, violation of which
shall be considered a serious breach of company rules and regulations. Petitioner allegedly
violated the Memorandum when she appeared in a Tide commercial. Consequently, ABS-CBN
placed petitioner under suspension for three months without pay. Petitioner then filed a
complaint against ABS-CBN and its officers for illegal dismissal, illegal suspension, and claims
for benefits. Meanwhile, petitioner, through its agent MJMDC, sent a Letter to ABS-CBN and
expressed that her suspension and alleged constructive dismissal were in violation of the
Agreement. For that reason, they were rescinding the Agreement at their instance. In response,
ABS-CBN, through counsel, rebuked the rescission, saying that there was no basis for it as
petitioner was an independent contractor and that her suspension for her violation of the
Agreement did not constitute constructive dismissal.
Labor Arbiter ruled in favor of petitioner. The NLRC reversed the LA’s decision. The
NLRC held that it cannot adopt the LA’s findings based on the principle of stare decisis. This,
considering that Sonza and petitioner were similarly situated as both were covered by the
Agreement containing identical provisions. Petitioner elevated the case to the CA via a Petition
for Certiorari on the ground that the NLRC committed grave abuse of discretion when it
applied Sonza vs. ABS-CBN Broadcasting Corp. without considering the substantial differences
in the situations. The case was referred to the Philippine Mediation Center for mediation.
Thereafter, the parties executed and signed a Partial Settlement Agreement. On appeal, the CA
rendered the assailed Decision based on the said Partial Settlement Agreement. Aggrieved,
petitioner filed the present petition.
Petitioner claims that she was an ABS-CBN employee based on the four-fold
test: first, ABS-CBN specifically selected and hired her for her individual and peculiar talents,
skills, personality, and celebrity status; second, ABS-CBN paid her salaries through a payroll
account every 10th and 25th day of each month and withheld compensation income tax; third,
petitioner was subject to ABS-CBN’s rules and regulations, as in fact, ABS-CBN placed her
under a three-month suspension without pay; and fourth, unlike her role as co-host of “Mel &
Jay,” ABS-CBN controlled the means and method of her performance of her job as newscaster
for TV Patrol starting in 1986 as she was merely tasked to read the news.
Issue:
Is petitioner an ABS-CBN employee or an independent contractor?
Ruling:
The Court ruled that petitioner is an independent contractor. An independent contractor is
one who carries on a distinct and independent business and undertakes to perform the job, work,
or service on their own account and under their own responsibility according to their own
manner and method, free from the control and direction of the principal in all matters connected
with the performance of the work except as to the results thereof. Hence, while an independent
contractor enjoys independence and freedom from the control and supervision of their principal,
an employee is subject to the employer's power to control the means and methods by which the
employee's work is to be performed and accomplished.
First, petitioner’s acknowledgment that she was hired by reason of her peculiar talents,
skills, personality, and celebrity status proved the presence of one of the elements of an
independent contractor. A unique skill, expertise, or talent is one of the factors in determining the
nature of a person’s status at work.
Second, payment through the company payroll on specified dates with income tax withheld
at source is not conclusive proof of employer-employee relations. Such an arrangement is
oftentimes agreed upon only for purposes of convenience and does not, in itself, create a badge
of employment status. What is notable is petitioner’s talent fee package, which as of her last
contract was at Php410,000.00 for the first year and Php417,000.00 for the second and third
years. In addition, petitioner was given a signing bonus of Php500,000.00 worth of ABS-CBN
stocks. This extraordinarily high rate is given to those with unique skills, expertise, or talent like
petitioner, who is considered an expert in the field with special qualities that an ordinary
employee does not normally possess. This placed her on equal terms with ABS-CBN as she was
allowed the power to bargain for the terms of her engagement, including her talent fee. Unlike
ordinary employees, who are usually in a position of weakness, petitioner had a say on the terms
of her engagement.
Third, petitioner viewed her three-month suspension without pay as proof that ABS-CBN
had power of discipline over her. This is incorrect. The suspension itself was improper under the
circumstances. Records showed that ABS-CBN suspended petitioner for her alleged violation of
the Memorandum prohibiting talents from appearing in commercials. The prohibition was
likewise imprinted in petitioner's contract as part of the warranty, stating she shall not appear in
commercials nor plug, mention, or otherwise promote in the radio and television programs herein
any radio or television program, segment or feature of any other radio or television station
without the prior written approval of the company.
Lastly, nothing on record shows that petitioner performed other tasks in relation to being an
anchor, or that ABS-CBN dictated how petitioner should read the news or perform her other
related tasks, if any. As a well-known veteran news anchor, petitioner’s manner in delivering the
news was distinctly her own. Her voice, stature, aura, and representation, form part of the unique
qualities that impelled ABS-CBN to pick her for the job. Petitioner “reading the news” is not the
same as an average person reading the same news. In addition, petitioner failed to establish that
ABS-CBN controlled the manner in which she performed her job as news anchor for TV Patrol.
On the contrary, the Court finds that petitioner performed the job according to her own manner
and method, free from the network's control. Possession of unique skills, expertise, or talent is a
persuasive element of an independent contractor.

Tiangco v. ABS CBN

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CARMELA C. TIANGCO vs.

ABS-CBN BROADCASTING CORPORATION

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